Owner, employees of Chappy’s Golden Shores arrested hours after Minnesota AG files 76 charges against them

article

This Hill City, Minn. assisted-living facility allegedly neglected patients, defrauded Medicaid and tried to obstruct the State's investigation into its practices, says the Attorney General.

HILL CITY, Minn. (FOX 9) - After a state investigation found evidence of patient neglect, Medicaid fraud and obstruction among other things, employees of former Hill City, Minnesota assisted-living facility Chappy’s Golden Shores now face a total of 76 charges from the Minnesota Attorney General’s Office.

According to AG Keith Ellison’s office, 10 people were charged with the counts of manslaughter, assault, neglect, racketeering, theft, operating a comprehensive home-care facility without a license, concealing the proceeds of these crimes, perjury and obstructing the State’s criminal investigation.

Those charged are former owner Theresa Lee Olson, who faces 25 of the charges, and other managers and employees.

The Aitkin County Sheriff announced Tuesday evening that Olson and four other employees were taken into custody after the charges were filed. 

Among her charges, Olson faces one count of manslaughter for the death of a Chappy’s resident.

Others facing charges are Benjiman Swanson, Lisa Anderson, Monika Olson, Alexcis Hines, Christina Meagher, Kristin Davis and Susan Ellis, all of Hill City. Janiece Mattson-Olson and Goergia Salomonson, of Grand Rapids were also charged in Aitkin County Court.

Earlier this year, the AG’s office opened the criminal investigation into Chappy’s after it was referred to them by Aitkin County. Over 1 million pages of documentary and digital evidence were reviewed, along with dozens of interviews with Chappy’s residents, employees, medical professionals, social workers, guardians and other witnesses.

The facility's license was revoked by the Department of Health as a result of the investigation. 

The investigation outlined numerous offenses by Chappy’s owner and her employees:  

Neglect

Chappy’s “subjected multiple residents to neglect” by not giving them proper health care, supervision, food or shelter. In an example, the AG’s office says a 72-year-old Marine Corps veteran died at Chappy’s in October 2018 because of “improper care and neglect.” A medical provider said the man’s catheter was “one of the worst [they] had ever seen,” and the result of “utter, complete neglect.”  

Medicaid fraud

Olson, with the assistance of some employees, allegedly defrauded Minnesota’s Medicaid program of $2.1 million by billing for health care services that did not occur or were not covered by Medicaid. Some Medicaid bills included services for residents that were not at the facility on the days billed.

Poor conditions

Charges say the residents were housed in unlicensed and unapproved facilities, including buildings with “holes in the closet leading to the exterior of the home, a broken window and door, visible water damage and rodent nests and feces.”

No background checks

Chappy’s billed Medicaid for services provided by health aides who had not passed background checks. Some of those aides had prior assault, burglary and electronic solicitation of minors convictions that would have disqualified them.

Chappy’s would list them as maintenance or custodial workers so they did not have to be present for State licensing reviews. The AG’s office uncovered messages sent to those employees telling them to use a basement entrance and exit to avoid State reviewers.

‘Mont Royal’

After the State suspended Chappy’s license, Olson sold the facility to her daughter for $1 and renamed it Mont Royal. As Mont Royal, the Olsons tried to obtain a new license from MDH, which was rejected. Despite the rejection, Chappy’s continued to operate unlicensed.

Obstruction

The State investigation also found an “extensive and coordinated effort to conceal evidence of fraud and maltreatment,” including falsifying records for State investigators and tampering with potential witnesses.

With a search warrant, investigators seized a notebook from Olson’s home with a list of reasons the facility did not call 911 after a patient broke their hip on some ice and also found a whiteboard that appeared to be a script for employees to follow when being interviewed by the State.

$1.7 million withdrawal

After the investigation began, Olson and her husband withdrew over $1.7 million from the Chappy’s bank account and sold two of the facility’s buildings for $1.